Centralised lubrication systems for machine tools in India: A market survey; Lincoln Helios (India) Ltd.

Abstract

Lincoln Helios (India) Ltd. markets and manufactures a wide range of lubrication systems in India. A market study ‘was done to study the Centralised Lubrication System (CLS) market for machine tools in India. The objective of the study was to find the types of CLS used in machine tools, to find the criticality of usage of CLS in each machine, to estimate the share of current demand due to OEMs and replacement demand, to find the share of competition and finally to identify specific niche applications for Lincoln Helios. A literature survey and secondary data analysis were done and a structured questionnaire was made. The respondents were design managers and purchase managers of machine tool manufacturers and production managers and maintenance managers of actual users of machine tools. Analysis shows that among the systems used 60% are single parallel systems and 27% are single line progressive systems. 21% of the systems used are manual and 79% are automatic. 98% of the systems use oil as lubricant while only 2% use grease. CLS is critical for CNC machines and presses. The total market size is Rs 440 lacs out of which new demand and replacement demand are Rs 295 lacs and Rs 145 lacs respectively. Cenlub is the market leader with 67% market share by volume. The factors which are considered important while buying a CLS ( in decreasing order of importance) are lead time, spares, sales and distribution, price and service. About 92% of the respondents were satisfied with the performance of existing systems but were open to idea of changing their existing supplier. CLS market being price sensitive, it is difficult for Lincoln Helios to capture mass market because of the price disadvantage. So Lincoln should operate in highly specialized niches where Cenlub products are unsuitable and imported CLS are used. The total market size for the imported systems is Rs 84 lacs. Lincoln will have advantages of a lower lead time, better sales network and lower price over imports. The machines in which they are used are Horizontal Machining Centre, Shearing Machine, Press Brakes, Presses and CNC Machines. The manufacturers using imported systems are HMT Ambala, Ameteep, Bharat Fritz Werner, Batliboi and ISGEC. . Lincoln can also capture the replacement market for imported machines which have imported systems fitted to them. Even if, Lincoln is able to get 10% of this market, Lincoln will have sales of Rs 15 lacs. Since Lincoln is stronger in lubrication systems using grease, it can focus on the market for grease lubrication systems. The total market for grease systems is 3.0 lacs out of which 1.5 lacs are imports supplied by Lincoln US. In the indigenous market Lincoln can focus on Rigimax and Glasnost which use grease systems. The total market for Lincoln here which can be tapped is approximately Rs 1 lakh. Lincoln needs to spruce up its sales and distribution network in major industrial areas to gain a competitive edge over imports. The total market potential for Lincoln, is thus Rs 100 lacs.